WAYNE, N.J. (
Valley National Bancorp
on Thursday reported fourth quarter net income of $32.1 million, or 19 cents a share, in line with the average analysts' profit view.
In comparison, net income was $31.6 million, or 18 cents a share, for the third quarter, and $16.9 million, or 10 cents a share, for the fourth quarter of 2008.
For the full year 2009, earnings totaled $116.1 million, or 67 cents a share, up from $93.6 million or 67 cents a share in 2008.
Earnings comparisons reflected the dilution from the issuance of 10.7 million common shares during 2009, which raised $135 million in common equity, and helped the company exit the Troubled Assets Relief Program, or TARP, in December as it redeemed $300 million in preferred shares that had been issued to the government in November 2008.
Valley National's credit quality bucked the trend for community banks with heavy concentrations in commercial real estate loans, as nonperforming assets -- including nonaccrual loans and repossessed real estate -- totaled just $98.4 million, or 0.69% of total assets.
Net loan charge-offs for 2009 were $39 million, or 0.40% of average loans -- again, a very low figure as compared to most commercial lenders. Loan loss reserves covered 1.09% of total loans as of Dec. 31.
Overall earnings performance during 2009 was good, especially considering the economic climate. The company's return on average assets for 2009 was 0.81%, improving from 0.69% in 2008, although the return on average tangible shareholders' equity declined to 11.34% from 11.57%, reflecting the capital raises.
The stock was trading lower in late morning action, slumping 4.5% to $14.72. It had, however, run up a bit ahead of the fourth-quarter report, rising more than 9% year-to-date based on Wednesday's finish at $15.42. It also set its 52-week high of $15.50 during Wednesday's session.
Written by Philip van Doorn in Jupiter, Fla.
Philip W. van Doorn joined TheStreet.com Ratings., Inc., in February 2007. He is the senior analyst responsible for assigning financial strength ratings to banks and savings and loan institutions. He also comments on industry and regulatory trends. Mr. van Doorn has fifteen years experience, having served as a loan operations officer at Riverside National Bank in Fort Pierce, Florida, and as a credit analyst at the Federal Home Loan Bank of New York, where he monitored banks in New York, New Jersey and Puerto Rico. Mr. van Doorn has additional experience in the mutual fund and computer software industries. He holds a Bachelor of Science in business administration from Long Island University.